Altex Inc. manufactures two products: car wheels and truck wheels. To determine the amount of overhead to assigning to each product line, the controller, Robert Hermann, has developed the following information. CarTruck
Estimated wheels produced40,00010,000
Direct labor hours per wheel 1 3
Total estimated overhead costs for the two product lines are $770,000.
a. Compute the overhead cost assigned to the car wheels and truck wheels, assuming that direct labor hours is used to allocate overhead costs.
b. Hermann is not satisfied with the traditional method of allocating overhead because he believes that most of the overhead costs relate to the truck wheel product line because of its complexity. He, therefore, develops the following three activity cost pools and related cost drivers to better understand these costs.
Activity Cost PoolsExpected Use of Cost DriversEstimated Overhead Costs
Setting up machines1,000 setups $220,000
Assembling 70,000 labor hours280,000
Inspection 1,200 inspections270,000
Compute the activity-based overhead rates for these three cost pools.
c. Compute the cost that is assigned to the car wheels and truck wheels product lines using an activity-based costing system, given the following information.
Expected Use of Cost Drivers per Product
CarTruck
Number of setups 200800
Direct labor hours 40,00030,000
Number of inspections100 1,100
d. What do you believe Hermann should do?

Fred smithers, a recent college graduate decided to open his own portable juice bar, smithers smoothies, to wheel around newport beach. you, a trusted friend of fred, are a business major that has also recently graduated and agreed to handle the books for a while to get some practical experience and have a favor that you can ask of fred in the future. given the following five transactions concerning the new venture, prepare the necessary journal entries for the transactions, post the journal entries to appropriate t accounts and prepare a trial balance as of the end of the month in order to answer to the necessary may 2: fred invests $12,000 of his own money to start the new company. this money was obtained from a part-time job working at a legal firm while he was in school. may 3: fred spent $5,100 cash to purchase a refrigerated trailer that he can pull behind his car and set up at the beach. under your advice, fred agrees to place the new asset under an account called "equipment." may 6: fred bought $640 of supplies on account from the flav-o-rite confectioners company. because they will last longer than a single accounting period fred agrees to record them as, "supplies" as per your suggestion. may 13: fred sat on the beach for six hours without a single sale and was feeling very down. right before he left, however, a plumber escorting his family reunion along the beach stopped by his stand and bought $800 worth of smoothies for the entire family. under your advice, fred agrees to call this cash revenue, "sales." may 15: excited about his new venture, fred withdraws $350 from the company to take his girlfriend out to dinner. what would be the balance in the cash account at the end of the period following the posting of all the transactions?

Mai and chuck have been divorced since 2012. they have three boys, ages 6, 8, and 10. all of the boys live with mai and she receives child support from chuck. mai and chuck both work and the boys need child care before and after school. te boys attend the fun house day care center and mai paid them $2,000 and chuck paid them $3,000. mai's agi is $18,000 and chuck's is $29,000. mai will claim two of the boys as dependents. she signed form 8332 which allows chuck to claim one of the boys. who can take the child and dependent care credit?

Which of the following statements about cash basis accounting is true? a. it is more complicated than accrual basis accounting. b. the irs allows all types of corporations to use it. c. it follows gaap standards. d. it ensures the company always knows how much cash flow it has.